A basic procedure of intemal control over cash receipts is t

A basic procedure of intemal control over cash receipts is that the deposit of the cash and the recording of the receipts into the journal should be separated. O True ? False

Solution

Correct option is > True

The cash deposit and recording cash receipt in journals should be separated. The receipt of cash can be partial or full against any services or as an advance hence the journal entry allocates the cash receipt in right account so that records can reconcile against the services provided or amount due. This is the purpose of have separate account and this enhance the control by way of reconciliation.